Financial terms of the deal were not announced Monday.
Reid joined the Panthers in Week 4 of last season after spending five seasons with the 49ers. He started all 13 games played and had 73 tackles, five pass breakups, one interception and a sack.
The Panthers made news when they signed Reid to a one-year deal last October. He was an unrestricted free agent and didn't attend training camp last summer — something Reid believes was a direct response by NFL owners to his decision to kneel for the national anthem alongside former teammate Colin Kaepernick in protest of social and racial injustice.